US home sales tick up to highest in three-and-a-half years

WASHINGTON (AP) -- Sales of previously occupied U.S. homes ticked up last month to the highest level in three and a half years, helped by a jump in the number of houses for sale.

The National Association of Realtors said Wednesday that sales rose to a seasonally adjusted annual rate of 4.97 million, up from 4.94 million in March.

Home sales have risen 9.7 percent in the past 12 months. Still, sales have changed little since November. The supply of available homes remains tight and many would-be buyers aren't able to get loans.

The number of homes for sale jumped to 2.16 million, up nearly 12 percent from the previous month. But inventory is still almost 14 percent lower than a year earlier.

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Many Americans remain hesitant to put their homes on the market. The Realtors group notes sales typically pick up in spring.

Still, many of the sales are going to private investors, who are buying up lower-price homes and then renting them out.

First-time buyers, who help drive healthy markets, made up only 30 percent of sales in March. That's well below the 40 percent typical in a healthy market and down from nearly 33 percent in March 2012. Those buyers purchase from existing homeowners, who then are able to move on to larger houses.

Since the housing bubble burst more than six years ago, banks have imposed tighter credit conditions and required larger down payments. Those changes have left many would-be buyers unable to qualify for the super-low mortgage rates.

One reason economists expected the increase is a measure of signed contracts to buy homes rose in March to the highest level in three years. There is usually a one- to two-month between a signed contract and a completed sale.

Contract signings have increased 4.3 percent so far in 2013, according to economists at UBS, while sales of previously owned homes have barely increased. That also points to rising sales.

The housing recovery helped Home Depot Inc. post a big gain in first-quarter net income, the company said Tuesday. Its quarterly profits rose 18 percent. The company also raised its full-year revenue and earnings forecasts.

Rising demand and limited supply have encouraged builders to boost construction. Applications for building permits rose in April to the highest level in nearly five years. And U.S. builders started work on more new homes and apartments in April compared with the same month a year earlier